Juan Hernandez, the head of the Internal Revenue office, has said that many hotels have offshore businesses established in tax havens, and this impedes the transparency of their operations in the Dominican Republic. The official explained to reporters from El Caribe that some of the businessmen in the hotel sector utilize a “triangulation” method by which they establish companies in tax-free locations, in order to sell tourist packages to the Dominican Republic, and then report just half of the price that they get for the tourist package to Internal Revenue. Hernandez said that the proposal to set VAT for the hotel sector at 8% is just not possible, because with the prices that the all-inclusives are declaring to the Internal Revenue office, they have no competition. He said, “With the Dominican Republic there is no way to compete. First for the quality of its people and (second) the price of the package, this, of course, if we accept that in Puerto Plata with US$23 dollars a night you can have a great time in a hotel, or for US$40 dollars, on average, is what the hotels in the East are declaring.”